Schedule F Flashcards

1
Q

criticisms of Schedule F (4)

A
  • formulaic, with no statistical, historical, or actuarial basis for formulas
  • unauthorized reinsurers may provide higher-quality protection
  • detailed calculations may lead to a false level of precision
  • slow payers who are financially strong eventually pay, while current reinsurers may not withstand a stress event
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2
Q

how aging of ceded reinsurance is determined

A
  • date on which claim must be paid by reinsurer, if specified; or
  • date on which insurer must report claim to reinsurer, if specified; or
  • date the amount exceeds $50K and is entered into the insurer’s accounts as a paid recoverable; else
  • if under $50K and no dates specified, report as current
  • recoverables from mandatory pools and associations reported as current
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3
Q

sections of Schedule F

A

1) assumed reinsurance
2) premium portfolio reinsurance effected or canceled
3) ceded reinsurance
4) issuing or confirming banks for letters of credit
5) interrogatories
6) restatement of balance sheet

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4
Q

importance of Schedule F to actuaries (3)

A
  • to understand sources of assumed reinsurance
  • to understand collectability of ceded reinsurance
  • to comment in SAO on net reserves for participation in underwriting pools and associations
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5
Q

adjustments to liabilities to restate gross of reinsurance (5)

A
  • loss and LAE reserves
  • UEPR
  • ceded reinsurance premiums payable
  • funds held under reinsurance treaties
  • provision for reinsurance
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6
Q

adjustments to assets to restate gross of reinsurance (2)

A
  • reinsurance recoverables on paid loss and LAE

* net amount recoverable from insurers (balancing item)

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